Kayak Expands, Calls Trip Advisor Copycat.
By Yeoh Siew Hoon ~ thetransitcafe.com
Tuesday, 24th March 2009
Yeoh Siew Hoon catches up with Kayak's man for Europe and Asia, Faisal Galaria, who is scouring for opportunities in the region.

Faisal Galaria, managing director, Europe and Asia, of Kayak has one clear mission – to do with the world's largest travel search engine what he did with Skype in Europe.

"I grew Skype in Europe and opened up seven countries for them. My intention is to do the same with Kayak," said Galaria, who said he was the 13th employee at Skype.

Galaria was appointed managing director, Europe and Asia, of Kayak eight months ago and is responsible for growing the footprint for Kayak.com across Europe and Asia.

He heads the London-based team which is focused on adding new travel providers including airlines, hotels, rental car companies and online travel agencies to Kayak.com's comprehensive search, and driving more traffic to Kayak.com's European and Indian sites, through strategic partnerships with leading international brands.

And while Europe is occupying more of his mindshare at the moment, Galaria is also looking out to Asia. With a foothold in India already, Galaria told Web In Travel that he was looking at new markets in the region although "it won't be in 2009".

"Maybe 2010, that is if we don't buy something first. The easiest way to get a presence is through acquisition."

He said this was something he would look at when the timing is right. "We have our options."

Faisal called India "an interesting market". "It offers such large potential but broadband penetration is so bad. I think the mobile product will be big for Asia."

Galaria said Kayak and Skype shared certain similarities. "Skype was big in Asia and Europe but not in the US but now it's coming up in the US. Kayak is strong in the US but growing in areas like Europe and Asia."

Both also have similar business models, he said. "Both rely on volume. Skype converts 7% of users to paid users and so needs 400 million users to generate revenue and profitability. Kayak works on CPC and it needs a lot of volume to generate significant revenues and profitability. We need searches and transactions."

According to Galaria, Kayak now has 40 million searches a month. "In one year, we grew the international percentage by 100%. True, the base figure was single digit but we have doubled it within eight months."

The company has been profitable since August 2007. In December 2007, Kayak acquired SideStep, a rival Web 2.0 travel-search site for US$200 million. The combined company produces $3.5 billion in annual travel sales, and it rakes in US$140 million in revenue, according to an article in Fast Company last August.

But the world of meta-search is just about to get more exciting. Trip Advisor's launch of a flight search tool and Kayak's launch of a new meta-search product for hotel reviews, TravelPost.com, have put the two companies at direct loggerheads.

When Trip Advisor announced its new flight search tool, which is the first such tool to offer a fees estimator, allowing comparisons of airfares with fees added in, Kayak's chief executive and co-founder Steve Hafner, said, "Kayak.com welcomes the competition since it should help grow the metasearch category – hopefully to Kayak.com's ultimate benefit.  We are flattered by how many design elements TripAdvisor has chosen to mimic from our site."

It was a comment reiterated by Galaria during a panel discussion at PhoCusWright@ITB when he said, "We welcome the entry of Trip Advisor into meta-search. It looks like Kayak, the essential look and feel is very Kayak-y. In the international market, people don't yet fully understand meta-search. The economy is making people realise its value and Trip Advisor's entry will educate more people."

Asked later by Web In Travel if Kayak was worried about Trip Advisor launching its own airfare meta-search, Galaria said, "We would be if they had better technology."

But the next battleground, said Galaria, will be in hotel user generated content. Kayak has tipped TravelPost as "the world's most comprehensive travel site for hotel reviews, descriptions and rates" and "the first metasearch site for hotel reviews that allows users to filter for reviews from people like them".

Said Galaria, "Trip Advisor is doing hotel reviews very well but it hasn't evolved that much. TravelPost is an aggregator of reviews and will provide a more balanced representation of reviews."

Kayak.com is predicting significant revenue growth for 2009 despite the current economic crisis.

Referring to a report (recently released by Hitwise), which indicates that online flight search has dropped 42% this January compared with the same month last year, the travel search engine has stated it is set for "record revenue and traffic during January 2009".

The travel search engine is poised to hit one billion searches by the end of the first quarter.
Said Galaria, "The recession has caused consumers to become far more value conscious. Price comparison sites like Kayak.com that search for prices and availability from hundreds of travel brands are now must-have resources to travellers who are not only looking for greater value for money, but are also fed up with misleading advertising and confusing websites."

So who will win? Said Galaria, the metasearch portal that wins is the one the customer chooses. "How easy is it to use, how accurate is it and how fast is it".

Web In Travel  2009 will be held from Oct 20-23 at Suntec City, Singapore. This year's WIT will comprise The WIT Conference (Oct 20-21) and The WIT Ideas Lab (9-11am, Oct 22 & Oct 23)

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